Industrial Compound Feed Product

The French feed industry is compiled of 213 companies with 198 companies
having more than 20 employees. In feed production France ranks number one in
Europe with more than 22 million tonnes per year and a turnover of €6.5 billion.
The sector employs 12,200 people and ranks third in the agro-food industry after
the dairy and meat industry.(Source: SNIA)

Total annual feed production seems to recover again a bit after a constant
decline since 2001. All major sectors saw an increase in production in 2007, the
largest one being in the cattle and in poultry feed production.

Cattle feed production shows a cyclical demand. From August to March
production of compound feed for beef cattle is well above 120,000 tonnes a month
and in the other months sinks around 95,000 tonnes. In spring and summer beef
cattle takes advantage of abundant grass growth and is fed more additional
compound feed in the other months.

Dairy feed show similar fluctuations with a monthly production of around
between 210,000 and 285,000 tonnes per month from August to March. In the summer
months feed production for dairy cows decreases to around 170,000 tonnes. On a
yearly basis some 5,07 million tonnes are manufactured of which dairy feeds have
a two third share. In contrary to many other European countries cattle feed
production shows a steady increase since 2004.

The production of pig feeds reached an all time high in 2001 with just over 7
million tonnes. Since then numbers have come down to 6.3 million tonnes in 2006.
This trend seems to be stopping as in 2007 there is a little increase of 60,000
tonnes in pig feed production. Pigs are mainly produced in the west in the
Brittany area. More than 3 million tonnes of pig feed come from this area. Pig
feed production is dominated by feed for fattening pigs, app. 4.4 million
tonnes, followed by sow feeds (app. 1.13 m tonnes) and feed for piglets (app.
785,000 tonnes).

France is the largest poultry feed producer in Europe. Concentrated in the
west of France, mainly in the province of Brittany, in 2007 close to 9 million
tonnes were produced. Brittany accounts for 36% of poultry feed production.
Poultry feed production was highest in 2000 with 9.76 million tonnes. Avian
influenza has brought this figure down and – although on the rise (+2.7%) –
still has not recovered from this impact.

France is a gourmet country. That is why feed production for other poultry
than industry broilers and layers is higher. Other poultry species, such as
turkeys, ducks, geese, quail and meat pigeons take a large share of total
poultry feed. Also the Red Label (organic) production of meat poultry is
classified as 'other poultry'. Poultry feed is roughly distributed as
follows:

Just as The Netherlands and Belgium France has a culture of eating veal.
However, this is not directly reflected in production of milk replacers. Much of
the veal is imported from The Netherlands, the reason why Dutch milk replacer
production is almost twice that of French production. Opposition to veal
production and use of other ingredients are reasons for a steady decline in milk
replacers production in France.

Paris is paradise for pets--and France is one of Europe's best markets for
pet food products. The "myth" of tiny dogs nestled in shopping bags at Le Bon
Marche or under chairs at Paris's five-star restaurants is not a myth at
all.

In fact, France has the largest pet population in Europe, with 10.2 million
dogs, 8.5 million cats, 7 million birds, 2 million rodents and a remarkable 27
million fish. The French are simply animal lovers, with 53% of households having
at least one pet.

The pet food market is a testament to the special feeling the French have for
their pets. About 53% of that total goes for dog food, and roughly 38% goes for
cat food.

Sales of wet pet foods generally decreased in 2006, in both value and volume
terms, whereas dry pet food sales tended to increase. The decline in wet pet
food is partly a consequence of the expansion of dry super-premium pet food
sales. However, wet pet food is not totally doomed to disappear, as the majority
of pet owners will continue to mix and alternate wet and dry food for their
pets. (Source: Euromonitor)

Due to the growing tendency for pet "humanisation", and a generally greater
inclination by owners to take more account of their pets' needs, dry
super-premium pet food sales grew strongly in 2006, especially in cat food.

Feed production for other (farm) animals is relatively high with 1.63 million
tonnes in 2007 but this volume contains feeds for rabbits (31%), sheep &
goats (41%), horses (13%), game (6.8%), and fish (6.7%).